Which one will be the biggest risk if you overlook it?
About Cost, Limitation, Marketing, Fulfillment and Returns
Recently, more and more companies are replacing their existing sales channels in online shopping malls with Shopify or building new brand websites with Shopify.
We provide the logistics web application "DCX" that connects to Shopify (using API) for customers in various industries. In general, there are more and more questions about building the Shopify store itself.
In this article, we'll share the points you should consider when building a Shopify store.
Shopify charges a monthly subscription fee for each plan. In addition, a payment processing fee (such as a credit card fee) is charged for each plan and payment method selected.
Shopify can be said to be a very cost-effective platform, as it has a wide range of features that can be used even with a small monthly usage fee, and various payment features are implemented.
But you need to keep these costs in mind, so you don't overlook them in your calculations.
Cost of Shopify Store Themes:
Shopify offers a large number of website design templates (themes). There are free themes, but if you want to create an elaborate design or a highly immersive site, it may sometimes be better to use a paid theme. The cost of paid themes is often only incurred at launch.
App costs:
Features that cannot be covered by Shopify alone must be augmented by installing apps from the Shopify app store as needed.
The number of apps is said to be over 10,000, and the fee structure varies by category and range of functionality, such as an upfront fee, a monthly fee, and a pay-as-you-go fee. By using multiple apps, the functionality of the store will expand rapidly, but the total monthly app usage fee can reach a significant amount. So, it's a good idea to do the math before you start using all the apps.
Cost of learning Shopify:
If you're new to running an ecommerce site or have limited technical skills, building and managing a Shopify store can be difficult. As a result, you may need to invest a significant amount of time and effort to effectively use its features.
In addition, there are many outsourcing companies these days that can build and run the Shopify stores for you instead. It can be smoother and easier compared to the learning costs of doing it yourself in your own business.
But the cost is there, so it is better to examine the cost of learning and doing everything in-house and outsourcing part or all the task to a third party.
Limited design customization:
Shopify offers a variety of design templates, and it is possible to make simple changes to the source code. However, if you want to make drastic changes to the design of the store itself, it can be difficult to do so due to limitations.
Integration with applications and tools:
Shopify is, in a sense, a "closed ecosystem." In other words, store features and extensions are limited to apps, tools, and software that work with Shopify's own platform. As a result, there may be restrictions on working with other platforms and core systems.
Over-reliance on apps:
Shopify's app store is full of useful third-party apps that extend its functionality. You can add them freely at any time, but if you rely too much on these apps, even though the functionality has increased, the uniformity of the look and design might be conflicted, the speed of the site might decrease, and the user experience might be worsen.
Even if you have a certain amount of sales in your online shopping mall, it doesn't necessarily mean that your newly built Shopify store will automatically reach your potential customers. And even if your physical store is doing well, there's no guarantee that people will come to your Shopify store.
So, after you build your Shopify store, you need to attract customers.
You need a marketing strategy. Before you launch your Shopify store, you need to identify your target audience, establish your product positioning, and know what differentiates you from your competitors.
If it's a well-known brand, existing fans may search for the brand name and visit. But in the case of a new brand, the first thing to do is build awareness and spread the brand image.
Once you've built your Shopify store, it's easy to forget about the scalability of your warehouse and shipping operations. How flexible and expandable can the logistics part be as your sales increase? It's a critical factor in growing your business.
For example, Facebook and Google advertising budgets can be easily increased or decreased online. In some cases, it may be possible to increase sales proportionally many times over by increasing advertising costs tenfold. But as sales increase, can the physical work of receiving and shipping keep up?
In difficult cases, fulfillment and warehousing itself can become a bottleneck to growing your business. Especially when shipping products from a small warehouse with in-house staff, shipping errors and inventory inconsistencies are likely to occur when the number of orders exceeds 1,000 per month.
To avoid this and create enough room for growth on your own site, research a quality logistics fulfillment company that can work with Shopify in the early stages of your business, and make sure the warehouse itself is scalable. It would be better to check it out in advance, including how it looks.
High return rates and return shipping costs have long been a problem for many ecommerce websites.
Some Shopify store owners make buyers pay for return shipping to reduce the return rate. But then, customers might be discouraged from making purchases because they are worried about bearing the return shipping cost.
A high number of returns can affect profitability. And slow processing of returns and refunds can lead to customer dissatisfaction. So, when you're estimating profits during the business planning process, don't forget to prepare these:
Decide on a return policy that complies with the law, but does not cause significant damage to your business.
Estimate the losses caused by returns, don’t overlook it.
Allocate person in charge to take care of returns to reduce lost.
To help you with the challenges of logistics fulfillment, we offer a logistics web application, DCX. It's API-connected to Shopify.
With DCX, you can automatically link real-time data to your Shopify store and outsource logistics fulfillment to our warehouse. We are one of the companies with the largest warehouse network in the world.
If you are looking to outsource your Shopify fulfillment, our staff may be able to provide you with a consultation. Please check the following page and contact us for more details.
Read more about Shopify Fulfillment